Difference between a freight forwarder and NVOCC
A Freight Forwarder is someone who undertakes to handle the movement of goods from point to point on behalf of the cargo owner..
A NVOCC which is the abbreviation for Non-Vessel Operating Common Carrier maybe defined as a “carrier to shippers” and “shipper to carriers”..
Most well established and experienced freight forwarders have below capabilities (either owned or outsourced)
- experienced in all modes of transportation – road, rail, air and sea
- able to provide cost effective and efficient cargo shipping solutions based on the customer’s requirement
- able to arrange storage for the cargo (usually all big forwarders have their own warehouses)
- able to arrange the distribution or “forwarding” of the cargo as per the instructions of their client
- have the capability to negotiate freight rates with the shipping line
- able to book cargo with the shipping line as per the requirement of the client or under their own contract
- process all relevant shipping documents such as certificates of origin, customs and port documentation, bills of lading and associated shipping/negotiating documentation (Eur1, Certificate of Origin, etc)
- issue their own approved house bill of lading (HBL)
- arrange transportation of the cargo from/to the customers premises and port
- have thorough knowledge of over border cargo movement
- able to arrange customs clearance
However there are some differences which separate these two entities..
- The NVOCC can and sometimes do own and operate their own or leased containers whereas a Freight Forwarder does not..
- In certain countries like USA, the NVOCC operators are required to file their tariffs with the government regulatory bodies and create a public tariff..
- NVOCC is in certain areas accorded the status of a virtual “carrier” and in certain cases accepts all liabilities of a carrier..
- A Freight Forwarding company can act as an agent/partner for a NVOCC whereas it doesn’t happen the other way around..
A traditional NVOCC does not provide above services provided by a freight forwarder, but in some cases the line between a NVOCC providing above functions and a traditional freight forwarder maybe blurred..
You can read more about this in my previous post reg the back to back bill of lading (https://shippingandfreightresource.com/2009/11/23/what-is-a-back-to-back-shipment/)
Do you have any other points that highlights the difference between a freight forwarder and NVOCC..?? Do share if you have..